Ian Marr, Chief Executive of Aberdeen YMCA , has discovered a funding stream (called a Social IMPACT Investment Partnership) that could revolutionise our approach to fundraising. For the purpose of explaining how it works we shall use the example of teaching young people how to blow up balloons (a pressing and desperate need).
STEP 1
Find a need that will make a real difference. This difference should not only be for the people you’re working with, but one that has a high cost for the rest of society if the problem is ignored. For example, supporting a young person to get a job avoids the cost of benefit payments for the government.
Or, teaching young people how to blow up balloons. If no one knows how to blow up balloons – how will balloons be blown?
STEP 2
Create a structure. You’ve found your need – but how are you going to go about meeting that need? Who do you need to get on board? What services do you require? How much will it cost? You need a business plan.
Decided you want to help young people blow up balloons? Great. Who will teach them to blow up balloons? How much will these wise teachers be paid? Where are we getting the balloons from? You need a balloon-based business plan.
STEP 3
Here’s where it gets complicated. The Social Impact Investment Partnership (this scheme) is a funding tool involving three partners: the delivery partner (nothing to do with giving birth), who provides the service to the young people (this will be you); the investment partner(s) who provide the working capital, paid to the delivery partner on a monthly basis; the outcome partner who repays the working capital plus interest as long as the agreed outcomes are achieved. Here’s a real-life, non-balloon related example from the YMCA in Aberdeen to help you get your head around it: the outcome of one project was to support 100 unemployed young people per year so that at least 60 of them would have a positive result, eg a job. The investment partners provided over £300,000 of working capital each year which meant that the project helped more than 60 young people to a positive result – 41 got jobs, others went to college etc. The investors will get their money back with interest from the outcome partner.
Back to balloons. The outcome of the project is to help young people blow up balloons. Your investor pays millions of pounds to see four young people able to blow up balloons. After years of training, discipline and practice – your four young people are able to blow up balloons (c’est une miracle!). The outcome partner then pays the money back to the investment partner with interest, on seeing all of the gloriously blown up balloons.
STEP 4
Localise it. YMCA Scotland have produced simple, template legal documents that you can use – you just add your name at the top and add your outcomes and budget, and you’re ready to go. The YMCA contact details are below.
Outcome: balloons. Budget: for balloons.
STEP 5
Identify your investors. Talk to your church / supporters; talk to your church treasurer or leaders: lots of churches have substantial money that they have to invest - where better to invest it than in your project? And this is an investment – they get their money back with interest if you achieve your outcomes!
Churches love balloons. Your church will be very excited to hear that you want lots of money to teach young people to blow up balloons for themselves.
STEP 6
Get your outcome partner on board. This is usually a government department which needs to save money by intervening to prevent much more expensive results if nothing is done to help the people that you want to help.
Governments love balloons. The government will be very excited to hear that you want lots of money to teach young people to blow up balloons for themselves.
STEP 7
Sign everyone up. Use the template legal documents for a Social Impact Investment Partnership and go change the world. It’s simple really but it needs to be carefully thought through so if you want to find out more about it, or to get the template forms, contact Ian Marr, Chief Executive at Aberdeen YMCA: 01224 643291, info@aberdeenymca.org.uk
Let’s go and change the world, one balloon at a time.
